Waste Management (WM) Reports In-Line Q2 EPS, Beats on Revenues

Waste Management (NYSE: WM) reported Q2 EPS of $0.81, in-line with the analyst estimate of $0.81. Revenue for the quarter came in at $3.68 billion versus the consensus estimate of $3.62 billion.

KEY HIGHLIGHTS FOR THE SECOND QUARTER 2017

• Overall revenue increased by 7.4%, or $252 million. The revenue increase was driven by positive yield and volume in the Company’s collection and disposal business, which contributed $158 million to revenuegrowth, and higher recycling commodity prices and volumes, which contributed $90 million of revenuegrowth.
• Core price, which consists of price increases net of rollbacks, plus fees other than the Company’s fuel surcharge, was 4.7%.(d)
• Internal revenue growth from yield for collection and disposal operations was 1.9%.
• Internal revenue growth from volume in the Company’s traditional solid waste business was 3.2% in the second quarter of 2017. Total Company internal revenue growth from volume was 3.4% in the second quarter of 2017.
• As a percent of revenue, operating expenses were 62.3% in the second quarter of 2017, as compared to 62.2% in the second quarter of 2016. Operating expenses as a percentage of revenue in the Company’s traditional solid waste business improved about 70 basis points during the quarter, though that margin improvement was offset by growth in the Company’s lower margin recycling brokerage business and higher fuel costs.
• As a percent of revenue, SG&A expenses were 9.6%, a 30 basis point improvement over the prior year quarter.
• Net cash provided by operating activities was $813 million, compared to $762 million in the second quarter of 2016, an increase of 6.7%.
• Capital expenditures were $299 million, compared to $312 million in the second quarter of 2016.
• Free cash flow was $520 million in the second quarter of 2017, compared to $461 million in the second quarter of 2016, an increase of 12.8%.(b)
• The Company returned $437 million to shareholders during the second quarter, paying $187 million in dividends and repurchasing $250 million of its common stock.
• The effective tax rate was approximately 36.6%.

For earnings history and earnings-related data on Waste Management (WM) click here.

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